Many small businesses eye operational adjustments amid U.S. tariffs: report

'It's a testament to their resilience, patience and strategic thinking in the face of uncertainty,' says expert of B.C. employers

BY Jim Wilson 12 May 2025

While many Canadian companies are feeling the strain of tariffs imposed by U.S. President Donald Trump, some businesses in British Columbia are looking to stay afloat by adjusting their operations, according to a new study.

Specifically, 74% of small- and medium-size businesses (SMBs) in the province are making strategic operational adjustments in response to tariff conditions—regardless of whether they expect direct impacts on their revenues—reports First West Credit Union.

That figure climbs to 93% among businesses already facing revenue declines, “indicating that those experiencing declining sales are more likely to be planning or implementing new strategies and considering multiple approaches,” according to the financial institution.

U.S. tariffs are already having a negative impact on the majority of small and mid-sized firms across Canada, according to a previous report from the Canadian Federation of Independent Business (CFIB).

How are Canadian employers adjusting amid US tariffs?

Among businesses affected by the tariffs, B.C. SMBs are doing the following, according to First West’s survey of 360 employers:

31% intend to altering their supply chains
24% are actively exploring domestic production and sourcing
27% intend to increase their prices

"Many of our business members indicated that their focus is on finding operational efficiencies through pricing adjustments, supply chain changes, exploring new domestic markets, and pausing growth investments,” says Scott Henry, Senior Research Analyst at First West. “It's a testament to their resilience, patience and strategic thinking in the face of uncertainty.”

Meanwhile, 55% of those expecting impacts on revenue are waiting to see how the situation unfolds before committing to specific preparations.

“The volatile nature of the way these tariffs are being implemented is also reflected in the survey data,” says Henry. “The caution our business members are showing seems to stem from their confidence. This confidence enables them to focus on identifying new opportunities and innovative solutions while remaining patient to see the full impact of the tariffs, rather than making significant, potentially disruptive changes.”

Developing a targeted response to US tariffs

Amid the ongoing tariffs issue, one expert from KPMG called on Canadian employers to make changes to their approach to the supply chain.

According to KPMG, employers should prioritize targeted operating outcomes to develop a response strategy model and scenario evaluation amid the trade war. The firm notes that companies can do that by:

Improving supply chain visibility to better understand existing operations and identify alternative suppliers in countries with lower or no tariffs, thereby mitigating disruption risks.
Enhancing resiliency through scenario planning and data-driven decision-making to proactively navigate future challenges.
Applying for tariff exclusions, where applicable, by submitting detailed justifications and documentation for eligible products.
Establishing lower transfer prices to reduce tariff liabilities.
Reviewing contracts related to customs duties and tariffs to understand legal obligations and find cost-saving opportunities.
Assessing country-of-origin rules to ensure compliance and maximise tariff-related advantages.

The Manitoba government is offering nearly $1 billion in support measures for businesses and workers in response to tariffs imposed by the United States and China, according to the provincial government.